Sweden chose a different path in the fight against coronavirus – shops, restaurants, gyms and schools stayed open during the pandemic, but people were asked to keep a safe distance from others and be reasonable. Despite that, it's predicted that Scandinavia's biggest economy will shrink by 7% this year.
COVID-19 has caused 31,000 cases and 3800 deaths in Sweden, which is more than in any other Nordic or Baltic country. Although early estimates led some to believe that Sweden's economy would be better equipped to adapt to the new conditions, unfortunately, more recent data don't support these claims. Minister of Finance of Sweden Magdalena Andersson says that the country is going through a serious economic crisis and the economy is declining faster than was expected.
Exports make up half of Sweden's GDP, and because external demand has decreased, Sweden's biggest companies like Volvo and Electrolux had to make thousands of workers redundant. In addition, 40% of Sweden's service companies are afraid of a looming wave of bankruptcies with negative effects on their businesses. According to Minister of Finance Andersson, rapid economic recovery is rather unlikely, while long-lasting economic decline is a more realistic scenario.
Although Sweden didn't restrict travel to their country and continues to be open for business, the connection between Tallinn and Stockholm hasn't been restored. Right now, the best way to export goods and travel to Sweden is through Finland.
The Swedish branch of Enterprise Estonia has drawn up an action plan to support entrepreneurs during this rapidly changing time. We believe that e-commerce will become more active in Sweden, which is also why we held a webinar on the topic of e-commerce. You can watch it by clicking here (long link: https://www.eas.ee/teenus/sihtturu-seminarid/).
Despite the fact that Estonia and Sweden are geographically rather close, we have very different business cultures, so you should pay attention to certain aspects.
Consensus among Swedes
Reaching a decision can take much longer in a Swedish company than in an Estonian one because Swedes prefer to discuss important issues with all key employees before making a decision. Smart decisions that lead to success are only reached in consensus, so it's very important that all employees support a proposed change. So you should always take into account that it might take more time and several meetings before you get to sign a contract. Estonians may mistake the careful consideration of Swedes for stalling or lack of interest. However, we recommend patience. From time to time, you can ask politely about the state of your inquiry, but don't be too pushy.
It can be said that Estonians generally tend to use harsher negotiation techniques than Swedes, and Estonians are not afraid of conflict. However, Swedes are not used to conflict during negotiations. Their goal is to always find a solution that everyone is happy with, so they are willing to compromise to reach an agreement.
On the other hand, my experience shows that sometimes Swedes are ready to give up on a contract or an agreement if the other party doesn't show any signs of willingness to compromise. Estonian business owners should keep this in mind and be open to compromise in order to reach the desired result.
Written agreements and thorough preparation
The Swedes like to thoroughly prepare for negotiations and sometimes they even draft up a plan for an upcoming meeting. They also always put the results of a negotiation in writing, usually right after the meeting. And they expect the other party to be equally as prepared. For Swedes, a contract is valid only once all clauses from beginning to end have been discussed together.
My general recommendation is to always follow written agreements and pay close attention to the contents of a contract – make sure it's clearly worded and that both parties have the a mutual understanding of everything, especially if the risk of confusion is higher because of a language barrier.
Good luck in making it on the Swedish market! We're here to help you if you need us.
If you'd like to know more, feel free to contact us.
Export Adviser in Stockholm
Telephone: +46 766 350 144
|Kristi Kivi Frimpong
Export Adviser in Malmö
Telephone: +46 723 758 394